And finally Helena Smith, our correspondent in Greece, reports that the surprise appearance of a crocodile on the island of Crete is providing some light relief for the austerity-hit nation:

On a day where Greece’s newly-installed finance minister Gikas Hardouvelis has promised that the country’s onerous EU-IMF-sponsored bailout programme is coming to an end, the appearance of a crocodile on the island of Crete is also producing some light relief for austerity-hit Greeks.

The two-meter-long reptile, more usually to be found in tropical climes – was spotted swimming in an artificial lake south of the seaside resort of Rethymno last week.

Today local media reported that a second crocodile had also been spotted in the same man-made reservoir intensifying efforts by regional authorities to remove the reptiles from the area.

“Crocodiles cannot survive and reproduce on Crete,” said Rethymno’s mayor Giorgos Marinakis, announcing that an operation would get underway to capture the creature and return it to its natural environment.

The crocodile has become a local sensation with fans christening it "Sifis" and setting up a Facebook page in its honour.

That is all for today. Thank you for joining us, we'll be back tomorrow. AM

3.47pm BST

The FTSE 100 has slipped to a two-month low. Other major European markets are up.

FTSE 100: -0.37% at 6,713.74

DAX: +0.15% at 9,797

CAC 40: +0.16% at 4,349.42

FTSE MIB: +1.01% at 20,909.45

IBEX 35: +0.5 at 10,742.70

3.36pm BST

We're back to the issue of "group think". Andrew Tyrie is in classic job interviewer mode. He wants examples of how she has demonstrated "independence of mind" in the past. She cites the "difficult messages" she had to get across on the eurozone while at the IMF.

Shafik says that as permanent secretary she was accustomed to telling minister things they did not wish to hear.

And with that, Tyrie brings the session to a close.

3.25pm BST

Shafik says there are problems across FX, fixed income, and commodities benchmarking.

She says that the UK needs flexibility when it comes to EU financial regulation, rather than a separate rule book.

Updated at 3.27pm BST

3.11pm BST

The TSC's Jesse Norman wants to know whether Shafik penned her written submission to the committee or whether it was Mark Carney or Sir Jon Cunliffe were behind.

She says she called upon Bank data and staff were very helpful but she takes full responsibility for the document.

3.00pm BST

On the BoE's bank sheet in the future, Shafik says it will most likely be smaller than the £400bn it is now, but bigger than the £50bn before the pre-crisis.

"We are entering a period in all advanced economies where the natural rate of interest is lower than it was before," Shafik says. i.e. the new norm for UK interest rates will be below the 5% pre-crisis level.

She says there has been "quite good progress" on the European Stability Mechanism. But bank resolution plans are too reliant on national mechanisms.

Updated at 2.39pm BST

2.21pm BST

"I'm not being hired to exclusive look at monetary policy", Shafik tells Tyrie. She'll be working more broadly across all the Bank's areas of policy and responsibility.

Now we're on to spare capacity in the UK economy, which the Bank's Monetary Policy Committee has estimated to be running at around 1-1.5%. Shafik says that the next estimate (at the Bank's August inflation report), will probably show that slack in the economy has fallen (which means we'll be closer to a rate rise).

The session is about to begin. The committee's chairman Andrew Tyrie welcomes Nemat 'Minouche' Shafik and asks her to outline here experience.

She talks about her role at the IMF, and her experience of working with some of the troubled eurozone economies.

Updated at 2.19pm BST

2.13pm BST

Before MPs on the Treasury Select Committee begin their questioning of Nemat Shafik (often known by her nickname Minouche) at 2.15pm, here is a quick reminder of her background.

Shafik joins the Bank of England from the International Monetary Fund, where she was deputy managing director responsible for the IMF's work in Europe and the Middle East, its $1bn administrative budget and human resources policies for the Fund's 3,000 staff (among other things).

Born in Egypt, she is also a British and US national, holds a degree in economics and politics from the University of Massachusetts-Amherst, an MSc in Economics from the London School of Economics, and a DPhil in Economics from St. Antony’s College, Oxford University.

Having been the youngest ever vice president at the World Bank at just 36, she then joined the UK’s Department for International Development (DFID) and rose to become the department’s most senior civil servant ( permanent secretary)

At DFID she oversaw all Britain’s overseas development work, including bilateral aid programmes in over 100 countries, before joining the IMF in 2011.

1.38pm BST

Coming up.... "Minouche" Shafik faces MPs.

Nemat Shafik. Photograph: FRANCOIS LENOIR/REUTERS

Next up: Dr Nemat Shafik, who joins the Bank of England as deputy governor in August, is being questioned by the Treasury committee.

The need for a joined-up housing policy is growing as fast as house prices themselves. The Bank of England has not ruled out a further rationing of mortgages, but the danger is that creditworthy consumers will suffer while cash buyers escape and house prices fail to respond.

The only long term solution is to address the persistent shortage of housing supply. The need for coordinated political action is beyond doubt.”

Greece's public sector workers are holding a 24-hour strike, shutting down public services and leaving state-run hospitals accepting only emergency cases to protest austerity policies imposed in return for the country's bailout.

Wednesday's strike did not affect public transport, although some roads in central Athens were briefly shut down for a demonstration. Another rally was scheduled for the evening.

The strike comes as Greece's debt inspectors from the International Monetary Fund, European Central Bank and European Commission return to Athens to review the country's progress in economic reforms.

Photograph: Aristidis Vafeiadakis/ZUMA Press/Corbis

Photograph: Aristidis Vafeiadakis/ZUMA Press/Corbis

Tourists look at the Greek parliament, fenced off because of today's strike. Photograph: ALKIS KONSTANTINIDIS/REUTERS

Updated at 12.50pm BST

12.46pm BST

And there's a bit of a row over Sainsbury's expansion plans in a leafy part of London

Sarah (@whatbutlersaw)

Shareholder claims locals of South End Green reacted with horror at though of Sainsbury's local opening.

Bentley on track for record year after sales jump 23%

Luxury carmaker Bentley has announced that it's on track for a record year, with demand from China, the Middle East and Germany all surging.

The Crewe-based firm has posted a 23% jump in sales so far this year, delivering 5,254 vehicles since the start of January.

Sales leapt by 61% in China, driven by demand for its "Flying Spur and Flying Spur V8" models.

Japanese sales surged 56%, while Bentley sold 27% more cars in the Middle East.

Despite the weakness of the Eurozone recovery, sales in Europe are up 11% this year, thanks to a "strong performance in Germany". But the UK market was more subdued, with sales up 2% - from 698 cars in the first half of 2013 to 713 this year.

Sales in the Americas rose 8% to 1,388; it's still the largest market for Bentley.

Bentley board member Kevin Rose declared:

"There is no question that some markets will remain tough but we are confident of a good 2014.”

Bentley Flying Spur V8 Photograph: Bentley

Bentley's new Flying Spur costs £140,900 (before 'add-ons'), so today's sales figues are the latest confirmation that the spending power of the world's richest people is undimmed.

Yesterday, Rolls-Royce reported that it had achieved record results so far this year. Like Bentley, it also cited strong demand in the Asia Pacific region, the Middle East, and Germany.

Updated at 10.56am BST

10.28am BST

Greek deflation rate slows

Speaking of Greece, new data shows that prices continued to fall in June, but at a slower rate.

Consumer prices fell by 1.5% in June, on an EU-harmonised basis, compared with June 2013. They'd shrunk by 2% annually in May.

The wider eurozone inflation rate has been stuck at 0.5% since May, as this chart shows:

But the cost of alcohol (+1.3%), transport (+0.6%) and communication (+0.1) services all rose.

Updated at 1.52pm BST

10.15am BST

Strike and protests in Greece today

The public beach of Perea during sunset last night, in the eastern suburbs of Thessaloniki, Greece. Photograph: Nikolas Giakoumidis/AP

It’s a big day in Greece where the country’s powerful union of civil servants has organized a national strike today – just as parliament gears up to vote on the part privatisation of the public power corporation (PCC).

Public sector employees denouncing the reforms demanded by the country’s creditors are holding two protest rallies: the first at 11am (9am GST) and the second at 2pm (noon)

In a statement released by the civil servants’ union ADEDY, the striking workers said they had been forced to take to the streets to protest the government’s privatization programme, evaluation scheme and mass firing of fellow employees.

“At a time when the government is intensifying its attacks against workers, the response that it gets must be universal,” it declared “We will not allow the carnivalism that the government wants to promote in the public services. They wll not have us as an associate in this crime.”

The 24-hour walk-out comes three days after the conservative-dominated government mobilised striking workers at DEH, the state-run electricity company and hours before parliament prepares to vote on selling off 30% of the company.

Helena explains:

Last night 15 independent MPs signaled they would support the call of the vehemently anti-austerity main opposition Syriza party to hold a debate on plans to hold a referendum on the sale. Missions heads representing Greece’s “troika” of foreign lenders at the EU, ECB and IMF are also due to begin talks in Athens today at the start of a new review of the Greek economy.

Passions are running high. On Tuesday, the Greek parliament formally legalized efforts to further liberalise the market by allowing shops to open on Sunday. The decision – published in the parliament’s gazette – now paves the way for stores to open across a wide swath of Athens and on islands and other tourist centres nationwide. The ban – for many the clearest sign of one of Europe’s most closed economies - had been strongly supported by the Greek Orthodox Church and the communist KKE party which had argued that de-regulation of trading hours would do little more than benefit major interest groups “who want to increase their profits and exploitation of workers.”

But while that appears to be a battle lost, the public sector cleaners fighting mass-firings at the finance ministry, appear to have won an unlikely ally. The nearly 400 female cleaners, who have become the face of the inequity of austerity, held talks with the country’s spiritual leader, Archibishop Ieronymos of Athens, on Tuesday in which he promised to do whatever he could to help them. The cleaners, now in their eighth week of protest outside the ministry of finance in the heart of Athens, described the meeting as “a huge morale booster” in their often fractious dealings with the government.

Updated at 12.30pm BST

9.53am BST

Read the story here....

Here's my colleague Lisa Bachelor's story on the latest house price figures:

“We have been hearing about a slowing in footfall for new builds over the last six weeks. The change in mortgage rules and uncertainty regarding interest rates are likely to have had an impact.

But there's still that supply problem, keeping prices up:

The uncertainty generated by the changes in interest rates, mortgage rules and an impending election are all acting as brakes on house prices, but we are short of a correction in the housing market particularly in London and the South East.”

9.11am BST

Andy Hatoum, co-founder of the property search engine Placebuzz.com, also reckons the quarterly house price data (showing a 2.3% rise) is a better guide:

IHS Global Insight is slightly more cautious than Berenberg, predicting UK house prices will rise by a further 4% this year, and by 6%-7% in 2015.

Their chief economist, Howard Archer, writes:

It is apparent that housing market activity has slowed recently. Specifically, the Bank of England reported that mortgage approvals for house purchases

moderated for a fourth month running in May to be at an 11-month low of 61,707. Clearly the introduction of new regulations under the Mortgage Market Review (MMR) has - at least temporarily - taken some of the steam out of housing market activity.

Updated at 8.53am BST

8.43am BST

Berenberg: UK house prices to rise 10% this year, and next year too

Let's get some perspective on the data from Rob Wood, economist at Berenberg.

He's compared today's Halifax's survey with the latest data from Nationwide, and concluded that house price inflation has stabilised - at around 10% per year.

Wood explains:

The pace of increase is not slowing, but it has stabilised.

Tighter regulations and the real chance of an interest rate hike this year have stabilised leading indicators and actual price inflation at current strong rates. We look for house prices to gain 10% in 2014 and 10% in 2015.

Wood also reckons that the UK recovery, and its chronic supply problems, will prevent prices coming off the boil:

Leading indicators remain strong, while the BoE’s intention to hike interest rates gradually means borrowing costs will remain supportive for several years. Consumer’s job worries are the lowest in 16 years, while insufficient housebuilding perpetuates a supply shortage.

Tighter regulations introduced in April through the Mortgage Market Review are mainly an administrative problem for banks. It now takes much longer to process applications, which has slowed housing transactions without hurting prices much.

We expect mortgage approvals to return to their upward trend over the next few months.

A row of houses in London. Photograph: Yui Mok/PA

8.36am BST

Halifax also reckons that the price/earnings ratio slipped slightly to 4.95 in June, from 4.98 in May.

That's based on the average earnings for full-time male employees, though.

The average full-time UK salary is actually £27,000 -- meaning the average house (£183,462) is 6.8 times higher.

8.25am BST

Halifax: housing demand still solid

Halifax argues that its quarterly house price data gives a better picture of the housing market.

That showed a 2.3% rise in the April-June period, compared to January-March.

Stephen Noakes, its mortgages director, reckons:

"Housing demand continues to be supported by an economic recovery that is gathering pace, with employment levels growing and rising consumer confidence, although real earnings growth remains sluggish."

But Halifax also flags up two reasons for caution:

Home sales edged down by 3% in May to below 100,000 for the first time in six months; however, transactions are still 15% higher than in May 2013. (Source: HMRC, seasonally- adjusted figures)

New buyer enquires fell for the sixth consecutive month in May, which if sustained could moderate further growth in demand. (Source: RICS)

8.21am BST

Photograph: Halifax

8.20am BST

This is the fourth time this year that Halifax has reported a drop in house prices.

Their monthly index does appear to be quite volatile, though, -- it showed a 3.8% jump last month.

8.17am BST

Despite June's dip, prices are still up by 2.3% over the last quarter, compared to the previous three months.

Updated at 8.19am BST

8.07am BST

Halifax: UK house prices dropped 0.6% in June

UK house prices fell by 0.6% in June, according to Halifax's monthly survey of the sector.

That's a bigger drop than expected, and suggests the property sector may be cooling as new mortgage affordability rules are applied.

The index also shows that prices have risen by 8.8% across the country in the last year, pushing up the average house price to £183,462.

The impact of the coalition government's 'late night levy' is starting to take effect, with annual charges of up to about £4,000 per annum for pubs opening beyond midnight in Newcastle and Islington, for example.

Wetherspoon has decided to reduce opening hours from the current 1am to midnight on Fridays and Saturdays, at most of our affected pubs, as and when the levy is introduced or renewed - a retrograde step for pubs, which will have a positive impact on supermarkets, since they will benefit from earlier pub closures.

It also reported that sales have dipped a little during the World Cup.

7.53am BST

This is a little awkward.

Pharmaceutical firm AbbVie has been forced to backtrack on its claim that many Shire shareholders support its £30bn takeover bid, after violating the City's rules.

Yesterday, AbbVie CEO Richard Gonzalez told reporters that Shire investors were "generally supportive of the transaction" -- something you're just not supposed to say unless you've got it in writing.

AbbVie confirms that it has not received any written commitments of support and accordingly retracts the statements. It acknowledges that in the absence of written statements of support from shareholders it is not in a position to make any statement of shareholder support which accords with the provisions of Rule 19.3.

7.44am BST

Opening post

Good morning, and welcome to our rolling coverage of the financial market, the economy, the eurozone and business.

Has Britain's properly market started to cool? We find out shortly, when Halifax releases its latest monthly house price index.

Economists have predicted it could show a small drop in prices, down perhaps 0.3% month-on-month. Tighter mortgage affordability rules and the prospect of interest rate rises may have hit demand.

But it's a volatile index, so it could well show that momentum is still strong in the market.

Over in Greece, meanwhile, the civil service union ADEDY has called a strike today in protest at the government's programme of public sector job cuts.

That'll show how much anger is still simmering in Greece about its austerity programme, as its Trioka of lenders return to Athens for another review of its bailout programme.

And in London, supermarket chain Sainsbury is holding its AGM -- it's the last one before long-service chief executive Justin King departs.

Joanna P. (@Inflammatory_)

ADEDY called a 24h strike for today protesting performance evaluation system across the public sector, PPC privatisation, layoffs #rbnews